How to improve Thailand's competitiveness?
By Jon Fernquest[Introduction | Vocabulary | Article | Reading Questions | Answers]
At 35th in the world, Thailand still has a high ranking in the annual Global Competitiveness Report prepared by the World Economic Forum. In Asia, only Singapore (5), Japan (7), Hong Kong (11), Taiwan (13), South Korea (24), and Malaysia (26) are ranked higher than Thailand:
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1. Switzerland
2. Finland
3. Sweden
4. Denmark
5. Singapore
6. United States
7. Japan
8. Germany
9. Netherlands
10. United Kingdom
11. Hong Kong
13. Taiwan
18. France
24. South Korea
26. Malaysia
35. Thailand
43. India
54. China
50. Indonesia
71. Phillipines
77. Vietnam
99. Bangladesh
110. Nepal
125. Angola
(Note: Laos, Cambodia, Myanmar were not included.)
The ranking is based on the factors outlined in the table below:
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There's still a lot of room for improvement, so it's worth comparing Thailand's ranking in different factors with other countries in Asia. Since Thailand actually dropped in the rankings this year, it's also important to determine what caused this drop and what can be done about it.
[Check back shortly for more]
Reading Questions
Here are some questions to guide your reading (See answers at end):1. What factors drove Switzerland to first place in the competitiveness rankings?
2. What was the principal factor led to the United States dropping from first to sixth place in the competitiveness rankings?
3. What other contributing factors led to the decline of the US?
4. What factors led Switzerland and the nordic countries to the top of the competitiveness rankings?
5. What is becoming more important for productivity growth?
6. Why did China rank so low at 54th?
7. What is the top ranked country in South America?
8. What caused India to move up two places?
9. How are the competitiveness rankings calculated?
Bangkok Post Article: September 27, 2006
ECONOMY / COMPETITIVENESSThailand slips two spots in WEF poll
Thailand has declined two places, to 35th from 33rd place last year, in the annual Global Competitiveness Report issued by the World Economic Forum. Switzerland, Finland and Sweden were the most competitive in the survey of 125 economies released yesterday by the WEF, based in Geneva. Rounding out the top 10 in order were Denmark, Singapore, the United States, Japan, Germany, the Netherlands and the United Kingdom.The US showed the most pronounced drop, falling from first place to sixth.
Among other major economies in Asean outside of perennial top-10 finisher Singapore (unchanged in fifth place), Indonesia advanced 19 places to 50th, Malaysia declined one place to 26th and the Philippines rose two places to 71st.
''The top rankings of Switzerland and the Nordic countries show that good institutions and competent macroeconomic management, coupled with world-class educational attainment and a focus on technology and innovation, are a successful strategy for boosting competitiveness in an increasingly complex global economy,'' the WEF said in a statement.
Among key rankings, Thailand placed 38th for basic competitiveness requirements, based on a combination of four ''pillars'': institutions (40) infrastructure (38), macroeconomy (28) and health and primary education, a poor 84th.
In the category of ''Efficiency Enhancers'' Thailand placed 43rd, based on three pillars: higher education and training (42), market efficiency (31) and technological readiness (48). For ''Innovation Factors'' the country's ranking was 36th, comprising business sophistication (40) and innovation (33). It ranked 37th for quality of the national business environment, and 30th for company and operations strategy.
''Our indicators point to the rapidly growing importance of higher education and training as engines of productivity growth,'' said Augusto Lopez-Claros, chief economist and director of the WEF's Global Competitiveness Network.
''Countries that, like the Nordics, are investing heavily in education are likely to see rising levels of income per capita, growing success in reducing poverty and an increasing ability to establish a presence in the global economy.''
The rankings are drawn from publicly available data and the results of the Executive Opinion Survey, conducted by the WEF and a number of partner institutes. This year, 11,000 business leaders were polled in the 125 economies surveyed.
Summaries are available for downloading, along with purchase details for the full report.
Bangkok Post Article II: September 27, 2006
Switzerland ranked most competitive
United States slips to sixth place PATRICK BAERTGeneva - Switzerland has pushed the United States out of top place in the World Economic Forum's annual ranking of competitive economies, a list published yesterday showed.
Switzerland rose on the quality of its business environment and the United States slipped on concerns about public finances.
Switzerland, which had been ranked fourth in the 2005 edition of the elite think tank's competitiveness index, climbed into the top position thanks to factors including its public institutions and scientific research, the WEF said.
The United States still received high marks for innovation, but dropped into sixth place because of growing threats posed by macroeconomic imbalances, particularly rising levels of public debt associated with repeated fiscal deficits, said the WEF.
The survey also pointed to quality concerns in the US health and education sectors, lower integrity of public officials and the mishandling of last year's Hurricane Katrina disaster, which dented confidence in the authorities.
Switzerland also overtook Finland and Denmark, which are traditional leaders in the index, and were in second and fourth place.
Sweden climbed from seventh to third place in the 125-country survey, which was based on a poll of 11,000 "business leaders'' and combined the macroeconomic context, innovation and use of technology, plus the quality of public institutions.
France, which was twelfth last year, lost six places to rank number 18 because, the WEF said, of its public deficit, rigid labour market, "mediocre'' administration, and problems in its education system.
"The top rankings of Switzerland and the Nordic countries show that good institutions and competent macroeconomic management, coupled with world-class educational attainment and a focus on technology and innovation, are a successful strategy for boosting competitiveness in an increasingly complex global economy,'' said Augusto Lopez-Claros, the WEF's chief economist.
Singapore remained in fifth place, while Japan climbed from 10th to seventh.
Germany, The Netherlands and Britain made up the rest of the top ten, with Hong Kong just outside in 11th place, after climbing from its ranking of 14th in 2005.
In the developing world, Tunisia leapt seven places to 30th. Like its regional neighbours Algeria and Morocco, the country has made "significant improvements in institutions,'' said the WEF.
China fell six places to 54th, largely because of falling confidence in its public institutions and its largely state-controlled banking sector.
The WEF also pointed to relatively low use of technology, including mobile telephones and the Internet, as well as secondary and tertiary education enrolment rates which "are still low by international standards.''
India rose two places to 43rd, thanks to a "capacity for innovation and sophistication of firm operations.''
However, the WEF noted that India's health and education sectors were insufficient and that successive governments had proven "remarkably ineffective'' in reducing the public sector deficit.
In Latin America, Brazil dropped nine places to 66th, because of its budget deficit. Chile remained the top-ranked country from the region, in 27th place.
The lowest-ranked country in the index was Angola, which was surveyed for the first time this year. AFP
Vocabulary (in discussion above)
World Economic Forum - an annual meeting where top business leaders, national political leaders, intellectuals, journalists, discuss and debate major social and economic problems
Nordic countries - Sweden, Norway, Denmark, Scandinavian countries
per capita - amount per person, the amount divided by people in the country
a think tank - a research institute that provides advice and ideas on future planning and strategy, policy, commerce, and military policy (See Wikipedia on think tank)
dented confidence - reduced confidence (if you bump another car with your car, you'll put a "dent" in the other car)
poll - an opinion poll, people vote on how they feel about an issue
competent - have the skills necessary to do some task (antonym: "incompetent")
coupled with - combined with
tertiary education - university education
Answer Key:
1. What factors drove Switzerland to first place in the competitiveness rankings?
Switzerland's "public institutions" and "scientific research."
2. What was the principal factor led to the United States dropping from first to sixth place in the competitiveness rankings?
Both "rising levels of public debt" and "repeated fiscal deficits" have created "macroeconomic imbalances" that have reduced the ranking of the US.
3. What other contributing factors led to the decline of the US?
Although the United States still leads innovation at the highest levels of healthcare and education, it has problems with overall quality and providing all its citizens with these benefits. Government officials' handling of last year's Hurricane Katrina disaster also raised fundamental questions about governance.
4. What factors led Switzerland and the nordic countries to the top of the competitiveness rankings?
Competent macroeconomic management, world-class educational institutions, technological innovation, and high quality public institutions.
5. What is becoming more important for productivity growth?
Higher education and training.
6. Why did China rank so low at 54th?
China ranked low because China's economy is still largely state controlled. There is "falling confidence" in China's public institutions and state-controlled banking sector. China also still suffers from low levels of technology usage,
including internet and mobile telephones, and low levels of university education.
7. What is the top ranked country in South America?
Chile.
8. What caused India to move up two places?
Innovation.
9. How are the competitiveness rankings calculated?
The competitiveness rankings are calculated from publicly available data together with a poll of 11,000 business leaders.
